Tenaska refinances one California solar project, to build another

Independent power developer Tenaska said Nov. 21 that has closed financing on its 130-MW Tenaska Imperial Solar Energy Center South project through an issuance of $319.4m of senior secured, long-term notes.

The private placement received an investment-grade rating of BBB- by Standard & Poor’s and Kroll.

“Tenaska Imperial South is a sound project and the market responded favorably,” said Jerry Crouse, CEO of Tenaska Energy. “We saw a significant and positive response to the issuance and appreciate our investors’ participation.”

Tenaska Imperial South began full commercial operation in early November and has a 25-year power purchase agreement with San Diego Gas and Electric (SDG&E). The project is located near El Centro in California’s Imperial Valley, and its nearly 2 million solar panels can generate enough electricity to power approximately 44,000 homes. At the time of its initial financing in 2012, Tenaska Imperial South was one of the largest solar facilities financed in the U.S. commercial bank market.

An affiliate of Tenaska is the majority owner of Tenaska Imperial South. Prudential Capital Group is acquiring a minority interest in the project, subject to regulatory approvals. Tenaska affiliates will manage the project. RBC Capital Markets LLC acted as financial advisor to Tenaska on the sale of the equity interest to Prudential Capital Group.

“An attractive market for project debt led us to refinance our existing mini-perm loan,” said Dave Kirkwood, Tenaska vice president and treasurer. “We hope to build upon the success of this transaction as we look to arrange financing for our next project, Tenaska Imperial Solar Energy Center West.”

Tenaska Imperial West, located near Tenaska Imperial South, will produce up to 150 MW under a 25-year power purchase agreement with SDG&E. Construction of the project is expected to begin in the first half of 2014 with initial commercial operation scheduled for 2015.

Both Tenaska Imperial South and Tenaska Imperial West were developed by Tenaska Solar Ventures (TSV), an affiliate of Tenaska focused on developing solar energy projects in the Imperial Valley and North America.

Tenaska, based in Omaha, Neb., is one of the leading independent power producers in the U.S., with regional offices in Dallas, Denver, Pittsburgh and Calgary and Vancouver, Canada. Tenaska and its affiliates have developed and constructed approximately 9,000 MW of natural gas-fueled and renewable power generation, and manage operations for approximately 11,000 MW of power generation consisting of 15 power plants. Tenaska formed CSOLAR IV South LLC to build, own and operate the Tenaska Imperial Solar Energy Center South. Affiliates of Tenaska serve as the managing partner.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.